The FTC is responsible for enforcing consumer protection laws online. This mandate extends to mobile apps. The Agency is in the process of ramping up its enforcement efforts in this area, so it makes sense to follow the FTC mobile apps guidelines it has recently issued.
Truth In Advertising
If you make claims regarding the performance of an app, the claims have to be true. I’m amazed how often I am asked at seminars what “truth” means. In response, I ask a better question – what are you trying to hide? If your app does something such as keep a log of all the calories a user consumes in a day, then you can say as much in your advertising.
Can you also say the app provides “guaranteed weight loss”? No. This statement would constitute a false claim because there is nothing to stop the user from watching a weekend marathon of Justified while inhaling pizza, sodas and the like.
The FTC is behind the ball on privacy a bit, but is trying to catch up. After all, it is always embarrassing when a state [California] has to come out with its own privacy laws to address concerns you should be taking care of as part of your oversight mission. Regardless, the FTC has the privacy issue by the teeth at this point and is running with it like a dog off a leash.
The new FTC privacy requirement boils down to providing your potential customers with a privacy notice prior to their purchase or download of the app. Yes, you have to comply with privacy law even if you give the app away for free.
In the policy itself, you need to identify your data practices. Tell users what information you collect from them, how you secure the information and what you do with it. Also, verify you have practices in place to safely dispose of the data when finished with it.
Kids Under 13
If you design a mobile app for a target audience of kids under 13, you must comply with the Children’s Online Privacy Protect Act of 1998, better known as “COPPA.” You also must comply if you know kids under 13 are using the app regardless of the age of the intended audience.
COPPA is a complex subject. For the purposes of this article, we can say you are required to follow strict rules regarding obtaining parental consent for the child to download and use the app before collecting any information related to the child. Yes, you read that correctly.
Once consent is obtained, you are then required to follow strict new rules regarding the information collected, how it can be used, security practices and disposal of older information. It is an expensive and time-consuming proposition, but FTC fines for failing to comply are as much as $16,000 per violation. If you have 100 kids using your app and you fail to comply with COPPA, the fine could be $1.6 million.
I criticize the FTC frequently for its efforts to strong-arm little companies while rolling over and playing lapdog for larger companies. I’m not the only one who feels this way. Having said this, we should credit the FTC for trying to clarify its positions through videos. Although the videos have a certain Prozac feel to them, they are informative. In this one, the FTC discusses its view on mobile apps.